December Operating Rates of Copper Pipe & Tube Producers Meet High Expectations, Gradual Pullback Expected in January [SMM Analysis]

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        The Operating Rate of Copper Pipe & Tube in December Was 82.94%

        According to SMM data, the operating rate of copper pipe & tube enterprises in November was 82.94%, up 1.26 percentage points MoM and up 10.81 percentage points YoY. The operating rate in December met high expectations and further improved compared to November. The operating rate of large enterprises was 87.27%, but the overall production of large enterprises relying on direct export orders for copper pipe & tube declined nearly 5% MoM in December. However, the operating rate of enterprises relying on domestic orders increased MoM in November, primarily driven by the growth in copper pipe & tube orders from air conditioner exports. The operating rate of medium-sized enterprises recorded 77.79%, with a slight MoM decline in November, mainly due to the lack of support from direct and indirect export orders. However, orders from domestic home appliance enterprises continued to support stable operations. The operating rate of small copper pipe & tube enterprises was 68.16%, with some support from brass order exports. However, the performance of bathroom hardware was mediocre, while orders for military and electrical categories remained stable.

        The Raw Material Inventory Ratio of Copper Pipe & Tube Enterprises in December Was 3.82%

        The raw material inventory ratio of copper pipe & tube enterprises in December was 3.82%, up 0.06 percentage points MoM. Copper prices declined in December, and year-end low-price clearance actions by copper cathode suppliers increased the willingness of downstream enterprises to stockpile raw material inventory.

        The Operating Rate of Copper Pipe & Tube Enterprises in January 2025 Is Expected to Be 73.38%

        According to SMM data, the operating rate of copper pipe & tube enterprises in January 2025 is expected to be 73.38%, down 9.56 percentage points MoM and up 1.89 percentage points YoY. According to ChinaIOL data, the production schedule for household air conditioners in January is 17.14 million units, down 1.5% YoY compared to actual production in the same period last year. From January to March 2025, the domestic sales production schedule for household air conditioners is 7.24 million units, 6.69 million units, and 13.9 million units, respectively, with YoY changes of -1.1%, +10.2%, and +12.5%. The export schedule for household air conditioners is 9.9 million units, 7.71 million units, and 11.08 million units, respectively, with YoY changes of +10.1%, +23.3%, and +10.0%. Additionally, according to SMM and market exchanges, large enterprises are expected to maintain operations during the Chinese New Year, with reduced production lines. Medium-sized enterprises are expected to begin holiday shutdowns gradually from the 20th to the 24th, while small enterprises are expected to start holiday shutdowns gradually after the 10th. Therefore, the January production of copper pipe & tube will be supported by the operating rates of large enterprises, and the overall industry operating rate is not expected to show a significant decline.

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